Drug pricing has become a hot topic of discussion among lawmakers in the past few years with several drugmakers under federal investigations, and pharma supply chain members, such as PBMs are also facing the backlash.

CVS’s growth in recent quarters has been fueled by strong demand for its PBM and specialty pharmacy businesses, which provide drugs to people with expensive chronic conditions like rheumatoid arthritis.

“We are the solution and not the problem,” CVS’s Chief Executive Larry Merlo said, noting that numerous evaluations from government agencies have concluded that PBMs drive real savings to the healthcare sector.

PBMs negotiate drug benefits for health insurance plans and employers, and have in recent years taken an increasingly aggressive stance in price negotiations with drugmakers.

They often extract discounts and after-market rebates from drugmakers in exchange for including their medicines in PBM formularies with low co-payments.

Merlo added both public and private health insurers continue to count on PBMs as “indispensable partners” that help manage their drug trends.

Shares of the No. 2 U.S. drugstore chain by store count, which posted lower-than-expected fourth-quarter revenue, fell as much as 2.34 percent to $75.23 in midday trade.

We are believers in the PBM model, and CVS and Express Scripts Holding Co both work to improve overall drug trends, Leerink analyst David Larsen said in a client note.

Express Scripts, the largest PBM in the United States, will report its quarterly results next week.

“Without the increased competition among manufacturers that the PBMs create, drug price inflation would be even higher than where it is now,” Larsen added.

CVS, which confirmed its earnings and cash flow forecast for the full year and first quarter of 2017, lowered its full year PBM unit revenue growth forecast to 7.5-9.5 percent from 8.5-10.5 percent.

Management indicated that branded drug price increases were lower than anticipated, driving some of the revisions, Larsen said.

Excluding items, the company earned $1.71 per share in the quarter ended Dec. 31, beating analysts’ average estimate of $1.67, according to Thomson Reuters I/B/E/S.

Revenue rose 11.7 percent to $45.97 billion, but was below analysts’ average estimate of $46.50 billion. (Reporting by Ankur Banerjee in Bengaluru; Editing by Martina D‘Couto)